I am announcing today that Defra will undertake a market sounding exercise to explore joint venture as a potential future business model for Defra’s Food and Environment Research Agency (Fera).

Fera provides a range of important services to Government, with key capability in the areas of plant and bee health, and food and environmental safety, as well as providing a range of services to the European Union and overseas Governments. It also undertakes a range of services for commercial customers primarily in the food, agrochemical and pharmaceutical industries where Government has little direct interest. This includes Fera’s proficiency testing schemes, with participants from over 90 different countries.

Fera plays an important role in the agri-food market. Its capabilities, brand and pedigree means it is very well placed to play an even greater role in what is a very important, and growing, global marketplace. This presents a real opportunity for Fera to grow its non-government revenue. It will also help offset the expected reduction in Government revenues. The constraints of operating within Government, however, currently limit Fera’s ability to exploit this opportunity fully. For this reason I am keen to explore whether the best option to protect the long-term financial viability and scientific capability of Fera is a joint venture.

An external partner who has the necessary expertise and experience could help Fera further develop and grow non-government revenue. This would enable Defra to achieve its long-term aims and ensure that Government will continue to have access to the high-quality scientific capability provided by Fera. This is consistent with support for the recently announced Agri-Tech Strategy.

I have agreed that the next phase of work on the future of Fera should include a market sounding exercise, where Defra will engage with interested parties to explore further the option of a joint venture. This approach is consistent with the Civil Service Reform Plan and Government’s overarching growth agenda. The joint venture option will then be tested against other viable options in a business case for changing Fera.

I believe that Fera offers a potential partner(s) a unique opportunity to work with Defra to develop and enhance what is an internationally recognised scientific organisation. I am also confident that a joint venture would offer new opportunities to Fera’s staff, who are essential to the continued success of the business going forward.

The Bee Health Inspectors, the Plant Health and Seed Inspectorate and the UK Government Decontamination Service currently within Fera, will remain in government due to their enforcement and statutory functions and will be outside of the scope of the market sounding exercise.

I will make a final decision on the future of Fera by the end of this financial year, once the next phase of the project has been completed, when I will make a further announcement.